Article excerpt

With higher gasoline, home heating oil, and utility prices, the prospect of natural gas shortages on the horizon, and rolling electrical brownouts in California, the election of President George W. Bush, former oil driller, and Vice President Dick Cheney, former CEO of an energy company supplier, comes at a fortuitous moment. It says something about our country's priorities, however, that these two men's experience in the energy industry was more frequently derided than praised during the presidential campaign.

For although Americans are the world's biggest consumers of energy, we are the only nation that purposely avoids self-sufficiency in energy. Much of the public looks down on energy production as a dirty business best kept out of sight. We're ashamed of our magnificent drilling rigs and refineries, and think of coal and nuclear energy as darkly dangerous. Reflecting this public taste, the federal government has raised numerous roadblocks to the development of our energy resources--with the result that we are now perilously vulnerable to energy shortages.

Although our economic growth and demand for energy have been substantial over the past quarter-century, our energy-producing capacity has declined dramatically. In the early 1970s, at the time of the oil embargo, we imported 36 percent of our oil, now we import almost 60 percent. In 1970, oil production peaked at 9.6 million barrels of oil per day; in 2000, production stands at 5.8 million. We haven't built a new oil refinery in a quarter-century, and we now have only 155 total, fewer than half the number we had in the 1970s.

And it's not just oil production that hasn't kept up with demand. Hydroelectric power has been declining, burdened with controls on water release levels and delays in federal re-licensing. Some dams have been closed. No new orders for nuclear power plants have been placed since 1978, and environmental wrangling has prevented the federal government from removing spent fuel from nuclear reactors as is desperately needed. Even though coal represents 90 percent of U.S. recoverable fossil energy reserves, no major coal-fired electricity generating stations are being built in the country--because regulatory restrictions by the Clinton administration discouraged both new construction and the modernization of older plants. That leaves natural gas, where imports from Canada have increased by an unsustainable 130 percent over the past decade to meet our demand.

Much of this has occurred because the U.S. has allowed environmental concerns to trump energy needs without sufficient consideration of the costs and benefits. In addition, economic sanctions against foreign countries have at times placed U.S. firms at a competitive disadvantage, reducing the supplies available from abroad.

These are problems we can solve over the next decade. By learning from past mistakes, we can implement an energy policy that focuses on developing our resources rather than one that relies on manna from heaven.

Mistake 1: Refusal to Develop Oil Sources. Oil supplies 40 percent of U.S. energy. Many federal properties throughout the U.S. contain potential major sources of oil, but are blocked from development by environmental demands. The trade-offs between oil exploration and ecological purity have lessened over the past decade, however, as exploration technology has become more sophisticated. There is now far less environmental disruption involved in sinking a well, as well as more oil extracted per well drilled.

Our most vital undeveloped oil resource is the small portion of Alaska's Arctic National Wildlife Refuge that holds up to 16 billion barrels of oil. This was set aside for potential oil and gas development, but an act of Congress is required for exploration to proceed. In 1995 Congress voted to allow exploration, but President Clinton vetoed the bill.

In 1998, areas were offered for lease near the National Petroleum Reserve, close to Alaska's Prudhoe Bay--which has supplied 25 percent of U. …

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